To all customers,
US Customs and Border Protection announced last Thursday that all wood shingles and shakes from Canada will now fall under the Anti-dumping/Countervailing Duty that was put in place last year (2017) on softwood lumber. This places an immediate 20.83% duty on the price of any of these shingles and has increased shingle costs by at least that amount, overnight.
We, at Shepley, buy a lot of shingles ahead to stay in front of the market, but Customs has taken the unusual step of issuing no warning of this duty coming and making it effective on any load coming across the border, regardless of when the order was placed. This means that truckloads of shingles we ordered 1-2 months ago do not escape the tariff. Their cost gets raised the 20.83% the moment they come across the US border.
What this means for you, your customers, and us is that we have some inventory on hand, but that all wood shingles we have already bought but not yet received will now be more expensive. We will average in the stock on hand to help contain some of the initial cost increase, but we will have to start raising prices effective today. We will all have to have difficult conversations about shingle pricing with our customers. Please let us help you with facts and communication.
This is a situation beyond all of our control, as the government seems quite set in its decision. Although we are making the case to officials that this is unfair and unjustified, there is little likelihood of short term reversal. The shingle market was pretty much shut down yesterday as it tried to absorb and understand the news.
Here is the press release from US Customs and Border Protection and from the Cedar Shake and Shingle Bureau, which has attorneys working with US Customs and the Commerce Department. This is something that you can sit down with your clients on, to show that this situation is out of your (and our) control. To re-iterate, there was no warning of, nor do we feel there is any justification for, the inclusion of cedar shingles in the Countervailing Duty on Softwood. The bottom line is that we produce very few cedar shingles in the US, most all production is in Canada. We do not understand the reasoning behind this duty, nor do we think it makes any sense.
If you would like to register your protest, the governing body for this duty is:
The US Department of Commerce
International Trade Administration
1401 Constitution Av, NW
Washington, DC 20230
202-482-2000
Please let us know how we may be of help through this challenge. Thank you.
Sincerely,
Tony